Kenney’s Alberta pension scheme is ‘risky’ and ‘costly’ and he knows it
EDMONTON – As Jason Kenney and the UCP appear ready to once again campaign for a duplicate Alberta pension scheme separate from the Canada Pension Plan (CPP), the Alberta Federation of Labour pointed to a government briefing note showing the premier lied to Albertans during their “Fair Deal Panel” consultations.
“The UCP’s 'Fair Deal Panel' misled Albertans when it came to the contribution rate and administration costs of an Alberta-only pension plan. They need to drop the games and be honest and straightforward with Albertans, especially when it comes to their CPP retirement savings,'' says Gil McGowan, president of the Alberta Federation of Labour, the province’s largest labour advocacy group. “Workers and their families have already been suffering enough from this government’s reckless risk-taking with their livelihoods, a separate pension plan would not be a net benefit for Albertans.”
The briefing note, drafted in 2020 for Minister of Seniors Deb Schulte and originally obtained by CTV News, shows the UCP withheld key details on the true costs and risks associated with the switch. The briefing note to the federal minister shows facts were withheld or misrepresented by the premier during consultations on his plan to cut Alberta off from the Canada Pension Plan (CPP) to form a duplicate Alberta pension plan.
“This government’s panels are props with pre-determined outcomes. The UCP use them in an attempt to provide cover for their ideological agenda, but they’re not fooling anyone.” says McGowan. “First floated by the Wildrose and now by the UCP, these proposals like a provincial pension plan just don’t make sense for workers.”
The UCP government has made it clear in the Legislature that they plan to continue their push to take over Albertans’ CPP holdings and move them to AIMCo, the Crown investment corporation for the Alberta government. AIMCo has been under scrutiny after having some high-profile losses in the market, along with turbulence within its management. Its reputation has suffered under Jason Kenney and the UCP.
A copy of the memo can be viewed here. [LINK]
“Just as Jason Kenney and the UCP took over the pensions of public-sector workers like nurses and teachers and moved them to AIMCo, they want to do the same for CPP, the only workplace pension for most Albertans,” says McGowan. “Jason Kenney and the UCP took over public-sector pensions by force. They want to do the same with CPP by fooling Albertans with misinformation.”
Backgrounder - UCP lied to Albertans during consultations on Alberta pension scheme
The AFL obtained a Memorandum drafted in 2020 for Minister of Seniors Deb Schulte and originally obtained by CTV news and reported on in July 6, 2021 by reporter Matthew Black. His article is here: [LINK].
According to the Memorandum, the UCP’s Fair Deal Panel left out key elements when it consulted Albertans on the idea of an Alberta pension plan.
A copy of the memo can be viewed here. [LINK]
The UCP partly relied on the work of the Fraser Institute.
It also used an analysis critiquing the Fraser Institute’s report by Keith Ambachtsheer for the C.D. Howe institute titled, “The Alberta Pension Plan Proposal: What’s in it for the People of Alberta?”
The Memorandum shows the UCP Fair Deal Panel did not include all of Mr. Ambachtsheer’s analysis of the Fraser Institute’s proposal. The UCP withheld his analysis showing higher contribution rates and administration rates, as well as exposing Albertans to higher levels of risk, than the Fraser Institute’s report.
The full quote from the Memorandum is as follows (emphasis added):
While the Panel used Mr. Ambachtsheer’s estimate of the amount of the Fund Alberta would receive, they did not include the rest of his analysis, in which he suggested both the contribution rate and the administration costs of an Alberta-only plan would be higher than those projected by the Fraser Institute. Ambachtsheer also warned that the departure from the CPP’s asset management governance would result in Alberta’s pension fund being exposed to higher levels of risk.
By not including these details, the Fair Deal Panel downplayed the potential risks and costs of starting an Alberta pension plan. The memo also states, “Similarly, the [Fair Deal] report does not address the need to create the infrastructure to collect and pay benefits – in fact, a later recommendation advises against the creation of an Alberta-only provincial revenue agency.”
The UCP’s Speech from the Throne on February 22, 2022 stated, “the government will continue to examine a possible Alberta pension plan as potential reforms to strengthen the province.”
On March 16, 2022, during Question Period, Minister Toews stated, “We are continuing with econometric work, actuarial work so that we can be fully informed and so that Albertans can be fully informed in making future decisions around an APP.” This was in response to a question from government backbencher MLA Jason Stephan.
Director of Communications, AFL